From Ambition to Reality: Policies to Support Sustainable Development Goals
In a discussion at the Brookings Institution on the 17 new Sustainable Development Goals that will be adopted on Friday at the United Nations, Lagarde noted; “countries out of their own determination can make a difference in achieving the SDGs. They do not have to wait for institutions, partners and others to make a difference.”
Meanwhile, IMF staff have published a research paper with some policy advice they believe will help countries hit targets set out by the ambitious development agenda over the course of the next 15 years. The study notes that “policies that foster economic transformation, economic and social inclusion, and protect the environment are of paramount importance for sustainable development.”
A holistic approach
While good policy decisions can reinforce synergies between economic, social, and environmental objectives, the authors say the trade-offs and challenges that individual countries face in pursuing their development goals vary significantly, with the right mix of policies depending on such factors as economic structure, levels of income and education, and institutional capacity.
Transform and diversify
The paper, “From Ambition to Execution: Policies in Support of Sustainable Development Goals,” examines the case for promoting economic diversification through structural reforms. “In a stable macroeconomic environment, structural reforms can play a crucial role in facilitating the shift of resources to their most productive uses and help to diversify production and exports.”
By diversifying their economy, the authors say developing countries can shift workers from low productivity agriculture into higher productivity sectors like manufacturing, trade and services, which create higher paying jobs in the long term and help improve living standards.
Most commodity exporting countries however, have been struggling to diversify—especially with the weakening commodity sector—and the paper commends Indonesia, Malaysia, and Mexico for having managed to move away from oil production by improving the business environment and...
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